Part A

a)Budget = $1,800,000; MARR = 10%. b)Individual projects must have a first (initial) cost of at least $400,000. c)Use the NPW decision criterion to determine the best feasible bundle of independent projects.

1. The best investment bundle consists of projects is 2. The NPW ($) of the best investment bundle is 3. The total first cost ($) of the best investment bundle is

Part B

a)Budget = $2,000,000; MARR = 10%. b)A maximum of four (4) projects can be selected. c)The NPW of a project must exceed $100,000 (i.e., a minimum of $100,001) d ) Use the NPW decision criterion to determine the best feasible bundle of independent projects.

1. The best investment bundle consists of projects is 2. The NPW ($) of the best investment bundle is 3. The total first cost ($) of the best investment bundle is

Gamma Company is planning to invest in several of eight (8) projects {A; B; ...H}. Unfortunately, it faces a range of constraints including budget, labour shortages, and the number of projects it can manage concurrently. The company is seeking your assistance in selecting the projects that will maximize its Net Present Worth (NPW) given different constraints. All projects have the same lifespan (duration). Projects A B D E F G H me UI Initial Cost 300,000 425,000 320,000 500,000 375,000 475,000 450,000 200,000 MARR = 10% NPW 85,000 125,000 60,000 150,000 100,000 110,000 110,000 80,000